Why the Kenya Kwanza Regime Is The Worst For Entrepreneurs, Business Owners, And Job Creators
In a country already teetering on the edge of economic hopelessness, the one thing that should be sacred—enterprise—is now the government’s favorite punching bag. Under President William Ruto’s Kenya Kwanza regime, business owners are not just ignored; they are actively punished. It’s not an accident. It’s not a coincidence. It is policy. And worse—it is design. The state has made it clear: When you dare scale, grow, or employ more than a few people, you become a marked target.
Take a long, hard look at the new electricity tariff structure introduced by the Energy and Petroleum Regulatory Authority (EPRA). As if the cost of doing business wasn’t already high, EPRA has now institutionalized economic discrimination by creating tiered tariffs. The more power you use—which is a good sign in manufacturing and processing—the higher you pay. This is economic illiteracy at scale. Instead of rewarding higher consumption, which would signal growth, scale, and investment, the government penalizes it.
In mature economies, industrial consumers enjoy preferential power rates. In Kenya, they get slapped with “premium punishment.” A manufacturing firm that dares run 24-hour production is charged Sh20 per kilowatt-hour, while a barber shaving four heads a day pays Sh15. How can you industrialize a nation when you punish productivity?
Then, there’s the issue of regulations. Every entrepreneur knows that in Kenya, you don’t just run a business—you also play cat-and-mouse with an endless zoo of regulatory agencies. If you’re small, you may escape notice. But dare to expand, hire more, or gain visibility, and a thousand hands show up at your doorstep: NEMA, KEBS, KRA, NHIF, NSSF, and even county inspectors whose job descriptions are as vague as their uniforms.
You’d think that success would buy you respect or at least a seat at the policy table. Not here. Under Kenya Kwanza, success earns you harassment. Fines are applied retroactively, compliance timelines are shortened arbitrarily, and business owners are labelled “exploiters” rather than contributors to national growth. Ruto’s government has cultivated a deeply adversarial relationship with job creators.
Look at taxation. Under Treasury CS Njuguna Ndung’u, the 2023 Finance Act and now the 2024 proposals are designed to bleed businesses dry. Minimum tax? Check. Digital service tax? Check. Turnover tax? Check. Withholding tax on professional services, even when there’s no payment? Check. There’s even a motor vehicle circulation tax that punishes logistics providers for owning trucks.
They say tax broadening, but in reality, it’s tax bullying. While informal businesses and politically connected cartels operate with impunity, formal enterprises are under a digital microscope. Every invoice, every M-Pesa transaction, and every online sale is now a taxable event. It’s not about equity. It’s about extraction.
Then, consider the introduction of eTIMS, which mandates every VAT-registered trader to submit their invoices through the Kenya Revenue Authority’s digital system. In principle, it should streamline revenue collection. In reality, it has become a tool of surveillance and arbitrary enforcement. Businesses are forced to delay transactions, wait for approvals, and justify even the most minor discrepancies—under threat of hefty penalties.
The government’s hostility toward enterprise is not just felt through taxation. It is built into the public procurement system. Small businesses are locked out through red tape and corruption, while medium-sized businesses are destroyed by delayed payments. The government owes suppliers over Sh700 billion as of early 2024. Many SMEs have collapsed while waiting for LPOs to be honored.
Meanwhile, big companies are being forced to lay off staff. In 2023 alone, over 70,000 formal jobs were lost, according to the Federation of Kenyan Employers. Multinational firms are relocating to friendlier markets like Rwanda and Ethiopia. Manufacturing’s contribution to GDP has shrunk from 10% to under 7%, yet this government still pretends to support local production.
Take the recent case of Devki Steel Mills. After decades of building capacity, investing in smelting and downstream steel production, they are now suffocated by imports. Why? Because the government slashed import duty on finished steel products to please Chinese suppliers. Local firms can’t compete with subsidized imports. Where is the “Buy Kenya, Build Kenya” policy?